Whether you’re planning a kitchen remodel, adding a bathroom, or refinishing your basement, many upgrades can add substantial value to your home. With the contractor hired and the architectural plans in hand, don’t forget to make sure your insurance adequately covers the work you will have done.

 

Home Renovation Insurance Tips

  • Call or visit your insurance agent to see if your home’s increase in value after the planned upgrades will raise your homeowners insurance premiums. Have that discussion before the work begins, so that you can pay any additional premium costs and be fully covered.
     
  • Before hiring a contractor, look them up on the Better Business Bureau website to see if there have been any complaints filed against them. Also get references from their past clients.
     
  • Check and comply with all local building codes, and obtain permits when required. In general, projects that touch on electrical, natural gas, plumbing, and public and personal safety may require permits.
     
  • Make sure your contractor carries workers compensation insurance that would cover injuries on the job and any loss of wages that may result from those injuries. Don’t just ask if they have workers comp, but request to see a copy of their policy.
     
  • Check to see if the subcontractors hired by the contractor you’re considering – whether carpenters, electricians, painters, plumbers, or whomever – have their own workers comp insurance. Their coverage, or lack thereof, may help you decide which ones to hire.
     
  • Make sure the contractor and subcontractors you plan to hire have commercial business/general liability insurance. If the contractors and subcontractors are not properly insured, their workers may be able to sue you if they get injured working on your house.
     
  • If the upgrade is a do-it-yourself project and you want to hire your own workers, or your contractor’s subcontractors aren’t properly covered, talk to your agent about possibly increasing the liability insurance level of your homeowners policy. You may also want to take out a personal umbrella policy, if you don’t already have one.
     
  • If you’re buying new things like furniture, a television, major appliances, or a home entertainment system, add them to your home inventory list, and make sure your homeowners policy adequately covers your new possessions.
     
  • Installing a swimming pool or hot tub may raise your potential liability, so you may want to consider a personal umbrella policy, if you don’t have one already.
     
  • Updating your electric or plumbing systems may help reduce the risk of water or fire damage and, as a result, your homeowners insurance premium may be lowered.
     
  • Keep receipts of all contracts, any materials purchased, and all work done. That way you’ll have a record in case any questions arise later.


For more information about AAA Home Insurance, visit AAA.com/HomeInsurance.

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